Solvay posts sharply lower net income

MOSCOW (MRC) -- Belgian chemical and pharmaceutical company Solvay SA reported sharply lower net income of EUR25 million (USD34.4 million) for the fourth quarter of 2013, down from EUR198 million a year earlier, with net sales down 5% at EUR2.42 billion, said Marketwatch.

For the full year, net income totaled EUR378 million, down from EUR690 million. The company said that was mainly due to one-off portfolio items. The group's net sales for the year reached EUR9.84 billion in 2013, down 5% on the year.

Analysts had expected net income of EUR57 million for the fourth quarter and a full-year profit of EUR410 million. They had also forecast stronger net sales, expecting fourth-quarter net sales of EUR2.44 billion and full-year net sales at EUR9.96 billion.

The company said recurring earnings before interest, taxes, depreciation and amortization, or Rebitda, fell 6% on the year to was EUR384 million in the fourth quarter, slightly above the EUR376 million expected by analysts. For the full year, Rebitda was EUR1.67 billion, down 12% from 2012.

The company said it had preserved pricing power "in a deflationary raw material" environment, with the fall in prices more than offset by savings on raw material and energy costs.

The company said that so far this year, Solvay's end markets have shown "early signs of improvement" and that the group is well placed to benefit from better economic conditions. "Although Solvay remains cautious, it is confident that 2014 will show growth supported by the delivery of excellent programs."

The results are adjusted for the fact that Solvay is planning to put its polyvinyl chloride assets in a joint venture with Ineos Group Holdings SA.

As MRC wrote before, Solvay in early February 2014 announced the opening of a new Research & Innovation center in Singapore, which will be the Group’s core innovation ground for its Consumer Chemicals growth engine in the Asia-Pacific region.

Solvay Specialty Polymers manufactures over 1500 products across 35 brands of high-performance polymers - fluoropolymers, fluoroelastomers, fluorinated fluids, semi-aromatic polyamides, sulfone polymers, aromatic ultra polymers, high-barrier polymers and cross-linked high-performance compounds - for use in aerospace, alternative energy, automotive, healthcare, membranes, oil and gas, packaging, plumbing, semiconductors, wire and cable, and other industries.
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MOSCOW (MRC) -- Clariant, a world leader in specialty chemicals, is focusing on its pioneering Wet Process Technology to ensure benchmark quality, premium lithium-iron phosphate cathode materials for automotive OEMs and battery manufacturers, reported the company on its site.

Clariant’s Life Power P2 lithium-iron phosphate cathode materials product family is produced at its Candiac site in Canada. The materials are a benchmark in terms of purity and consistent quality and provide outstanding power capability and low-temperature performance. Closure of the company’s dry process pilot plant at St. Bruno, Montreal, emphasizes its confidence in the superior power performance and consistent quality achieved through Wet Process Technology.

EngHeng Khoo, Vice President, Energy Storage, Clariant, comments: "Clariant is the largest industrial scale high-quality lithium iron phosphate provider to the market. We believe Wet Process Technology is the way forward to ensure future-proof, superior quality cathode materials for Li-ion batteries that can help car producers support the trend toward green mobility."

Battery manufacturers are already taking advantage of Clariant’s Life Power P2 materials. Examples include a full electric car rental scheme in a major European city and electric buses on the streets of many cities in the world.

We remind that, as MRC informed previously, new liquid vehicle technology (LVT) developed by Clariant Masterbatches in May 2012 appears to eliminate many of the problems that have prevented wider use of liquid color and additive concentrates in extrusion blow molding of polyolefins (high- and low-density polyethylene and polypropylene). The new Clariant masterbatches use a liquid vehicle system that incorporates suspension aids and binders have been incorporated into the new LVT masterbatches to allow for higher pigment loadings and lower usage rates.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints.
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MOSCOW (MRC) -- Borealis and Borouge, the world's leading providers of innovative, value-creating solutions for the wire and cable industry, continue to deliver on their commitment to driving innovation in the global industry, reported Borealis on its site.

Borealis and Borouge have developed new products such as Borealis PP4874 for data cables and Borealis LE0563 for submarine power cable jackets, which will be showcased at the 2014 Wire Dusseldorf. Thus, the company is going to launch its two new grades at the event.

"Borealis and Borouge have been key drivers in the wire and cable industry in 2013," says Gilles Rochas, Borealis Vice President for Energy & Infrastructure. "We will continue to invest in the future. Our next great opportunity to demonstrate our long-term commitment to our partners and customers in the industry is the Wire Dusseldorf in April. By showcasing our flagship solutions and cutting-edge innovations we again prove our ability to bring energy all around."

As MRC informed before, last summer, Borealis and Borouge announced the dedicated roll-out of the technology platform Borlink in Russia, according to the company's press release. Borlink was introduced by Borealis and Borouge as a technology platform offering a complete global package of power cable compounds and expertise serving applications for medium and high voltage (MV, HV), including extra high voltage (EHV) and high voltage direct current (HVDC).

Key innovations of Borlink include a tailor-made high pressure (HP) process for the production of high purity low density polyethylene (LDPE) base polymers with superior electrical properties and the introduction of a closed or controlled loop (from monomer to final packaging) which avoids contaminants and ensures homogenous and high-quality, clean compounds.

Borouge is a joint venture between the Abu Dhabi National Oil company and Borealis.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. Borealis is headquartered in Vienna, Austria, and operates in over 120 countries with around 5,300 employees worldwide, generating EUR7.5 billion in sales revenue in 2012.
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MOSCOW (MRC) -- OAO Gazprom, Russia’s gas exporter, faces at least a year’s delay in starting shipments from its liquefied natural gas plant in Vladivostok, according to three people with knowledge of the matter, said Hydrocarbonprocessing.

The LNG facility, which the state-run company has said will begin output in 2018, may start in 2019 or 2020, said the people, asking not to be identified because the information is confidential. There are delays in sourcing the gas for the 10 million-tpy liquefaction capacity, they said.

The company hasn’t changed its plan to begin production at Vladivostok in 2018, a Gazprom official said by telephone from Moscow, asking not to be identified citing internal policy.

The project in Russia’s Far East is a day away by ship from the world’s biggest LNG importer, Japan, which has several supply contracts due for renewal from 2018, one of the people said. Japan has the option to renew with current suppliers Qatar, Australia and Malaysia among others or buy from emerging LNG facilities including in Mozambique, the US, and Russia.

One of the gas fields that may supply the LNG plant was found to have a large oil layer on top, which may need to be pumped out before gas extraction begins, one of the people said. Drilling at the Yuzhno-Kirinskoe field continues and a clearer plan for its development won’t emerge before the end of the year, the person said.

Delays in starting LNG production would increase costs, while Japanese buyers are asking for discounts since this will be a new facility, two of the people said. The project is still attractive to Japanese purchasers, who want to diversify their supply sources, the people said.

About 10 companies are in talks with Gazprom about investing in the gas extraction or the LNG production part of the Vladivostok project, one of the people said. India, China and some Southeast Asian countries could also be buyers of LNG from Vladivostok, the person said.

As MRC wrote before, Gazprom is already building a gas liquefaction plant in Vladivostok, eastern Russia, to supply the Asia-Pacific region. Companies from Japan, a large consumer of LNG, are in talks on purchasing supplies from the facility. We remind that, as MRC informed earlier, Gazprom can return to the construction of LNG plant with the nominal capacity of 7 million tonnes in Primorsk (Leningrad region).
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MOSCOW (MRC) -- Further to the earlier decision of the European Commission to continue its evaluation of the proposed 50/50 Joint Venture between Solvay and INEOS in a Phase II investigation, the parties have jointly agreed to put forward a revised remedy package to address any competition concerns that have been raised by the European Commission, said Solvay in its press release.

The proposed remedy package, which was submitted to the European Commission yesterday, comprises the divestment of the PVC plants at Schkopau (Germany), Beek (The Netherlands) and Mazingarbe (France) along with the chlor-alkali, EDC and VCM assets at Tessenderlo (Belgium). These facilities are all currently operated by INEOS and are strategically important within the European chemicals sector. They have the ability to compete as successful stand-alone businesses under third party ownership.

The European Commission will now consider this remedy package alongside any further market testing it wishes to undertake ahead of making a final decision. Assuming such asset disposals are required to obtain Commission clearance this would be subject to full consultation with employee representatives.

INEOS and Solvay will continue to run their businesses separately until completion of the transaction, which is dependent on the above approvals and procedures.

As MRC wrote before, two of Europe’s biggest chemical companies agreed a joint venture that will create one of the world’s largest producers of PVC plastics by revenues in May 2013.

Solvay S.A. is a Belgian chemical company founded in 1863, with its head office in Neder-Over-Heembeek, Brussels, Belgium. The company has diversified into two major sectors of activity: chemicals and plastics. Solvay supplies over 1500 products across 35 brands of high-performance polymers – fluoropolymers, fluoroelastomers, fluorinated fluids, semi-aromatic polyamides, sulfone polymers, aromatic ultra polymers, high-barrier polymers and cross-linked high-performance compounds.

INEOS Group Limited is a privately owned multinational chemicals company consisting of 15 standalone business units, headquartered in Rolle, Switzerland and with its registered office in Lyndhurst, United Kingdom. It is the fourth largest chemicals company in the world measured by revenues (after BASF, Dow Chemical and LyondellBasell) and the largest privately owned company in the United Kingdom.
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